Even after the sale that split the company in two, Heritage Properties Inc. is still one of the largest real estate management companies in Mississippi.
Recently rated No. 12 of the top 25 multifamily builders in the U.S. by Multi-Housing News, Heritage Properties, owned by James P. Carney of Jackson, reported 1,110 multi-housing rental starts in 1998 alone.
“We retained about 1,800 units under management, including fee managed properties, and we have another 528 units coming out of construction that are in lease-up mode,” said Carney. “Several other projects are in construction phases now and others are on the drawing board.”
Earlier this month, Vinings Investment Properties Trust (NASD OTC BB:VIPIS), a self-administered real estate investment trust that primarily owns and manages multifamily properties, purchased 13 multifamily communities totaling more than 2,000 units throughout Mississippi, located primarily in metro Jackson, from Heritage Properties. The purchase price of $94,300,000 included the assumption of $80,958,000 in debt.
“In addition, The Vinings will go to contract on several more that are in the lease-up phase when they are complete,” Carney said.
Five communities, totaling 968 units and located in the metro Jackson market, were purchased through a joint venture structure between Vinings Investment Properties LP and a private investor from Pennsylvania. Eight of the communities, totaling 1,064 units, were purchased by subsidiaries of the operating partnership through the issuance of approximately $8.6 million in Series A Preferred Partnership Units.
Apartment communities included in the sale were Bradford Place in Byram, Cambridge in Brandon, Cottonwood in Greenville, Delta Bluff in Walls, Fox Gate in Hattiesburg, Hampton House in Long Beach, Heritage Place in Senatobia, The Landings in Vicksburg, Northwood in Meridian, River Pointe in Robinsonville, Riverchase in Jackson, Southwind in Richland and Trace Ridge in Tupelo.
“This acquisition fits perfectly into our strategic growth plan here at Vinings,” said Peter D. Anzo, CEO of Vinings Investment Properties Trust. “Now that the buying frenzy has finally subsided and real estate prices have come more in line with our acquisition goals, we have been able to accomplish our first step in creating a stable base of steady income producing assets which will allow us to continue increasing shareholder value.”
The properties, which consist of two- and three-story garden-style apartment homes, average approximately 1,000 square feet and three years of age. The average occupancy at closing was 94%, down approximately 3% from the prior year.
Even though the sale was finalized May 3, the sale had been pending for almost a year.
“REITS are out of favor right now because a lot of attention is being put on the Internet and money closings are going in other directions,” said Paul Snow IV, investment broker at Morgan Keegan in Jackson. “But REITs are still good investments with good, strong balance sheets. You really can’t go wrong with REITs.”
Vinings Investment Properties Trust’s initial public offering was in February 1985, when 7.5 million shares were offered at $10 per share by E.F. Hutton & Co. The lowest activity on insider trading was in February 1998; the highest activity was in November 1994.
Other REITs with a presence in metro Jackson include Mid America, a self-administered and self-managed REIT that owns, develops, acquires and operates multifamily apartment communities in the southeast U.S. and Texas. As of December, 1998, Mid America owned and operated 131 apartment complexes in 13 states. In the metro market, Pear Orchard Apartments in Ridgeland is Mid-America’s largest complex, with 389 units.
Two Atlanta-based companies acquired four multifamily apartment communities in Ridgeland within the last several years. Post Properties acquired three properties and Colonial Trust picked up one.
Apartment communities under construction at Heritage Properties:
• The Crossings in Vicksburg, 144 units
• The Crossgates in Starkville, 156 units
• Lexington Pointe in Oxford, 156 units
• The Reserve in Ocean Springs, 408 units
• Bradford III in Byram, 200 units.
• The Wellington in Jackson, 196 units
Apartment complexes on the drawing board:
• The Colony in Columbus, 128 units.
• The Pointe in Gautier, 168 units.
• The Waverly in Waveland, 120 units
• Arbor Gate in Picayune, 120 units
• Woodchase in Clinton, 248 units.